EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0840384
Customs Act 1901
Background
Part XVA of the Customs Act 1901 (the Act) sets out a scheme under which Tariff Concession Orders (TCOs) may be made by the Chief Executive Officer of Customs (the CEO). A lower rate of customs duty applies to goods that are the subject of a TCO.
Under section 269F of the Act, a person may apply to the CEO for a TCO in respect of goods. If the CEO is satisfied that the application is not in respect of goods specified in section 269SJ of the Act, which sets out those goods that cannot be subject to a TCO, the CEO must decide whether the application meets the core criteria.
Section 269C of the Act provides that a TCO application meets the core criteria if, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B of the Act provides that ‘goods produced in Australia’ has the meaning given by section 269D, ‘ordinary course of business’ has the meaning given by section 269E and ‘substitutable goods’ in respect of goods the subject of a TCO application, means goods produced in Australia that are put, or are capable of being put, to a use that corresponds with a use (including a design use) to which the goods the subject of the application can be put.
Subsection 269P(3) of the Act provides that if the CEO is satisfied that a TCO application meets the core criteria, the CEO must make a written order (a TCO) declaring that the goods the subject of the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff) specified in the order applies.
Jasco Pty Ltd applied for a TCO in respect of certain glue sticks on 19 November 2008.
Instrument
TCO No 0840384 was made on 06 February 2009. It declares that those certain glue sticks are goods to which item 50 of Schedule 4 to the Tariff applies since the CEO was satisfied that no substitutable goods were produced in Australia. The general rate of duty on these goods is 5%. The rate of duty for the goods subject to the TCO is free.
Consultation
Subsection 269K(1) of the Act provides in part that as soon as practicable after accepting a TCO application as a valid application, the CEO must publish a notice in the Gazette which includes an invitation to any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. The CEO did not receive any submissions in response to this invitation.
Commencement
Subsection 269S(1) relevantly provides that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged. TCO No. 0840384 is taken to have come into force on 19 November 2008.
The TCO does not affect the rights of a person (other than the Commonwealth) as at the date of registration so as to disadvantage that person or impose liabilities on a person (other than the Commonwealth) in respect of anything done or omitted to be done before the date of registration. The rights of importers will be beneficially affected. Under paragraph 126(1)(r) of the Regulations, importers of such goods will be able to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force. The TCO does not impose any liabilities on any person.
Overview
The Customs Act 1901, enacted by the Australian Parliament, facilitates the application of tariff concession orders (TCOs) that reduce the customs duty on specific goods. This Act was designed to address the need for a streamlined process to provide tariff relief for imported goods, ensuring that certain products become more accessible and affordable. Under the Act, the Chief Executive Officer of Customs has the authority to grant these concessions, subject to meeting specified criteria. In the case of Tariff Concession Order No. 0840384, issued on 6 February 2009, certain glue sticks were subject to a concession that eliminated their customs duty, provided no substitutable goods were produced in Australia. This legislative framework aims to encourage trade by reducing the financial burden on importers, thereby facilitating the flow of goods and supporting economic activity.
Scope and Application
The Tariff Concession Instrument No. 0840384, pursuant to the Customs Act 1901, applies to entities and individuals who are involved in the importation of specified goods, namely certain glue sticks in this instance. The Act operates at the Commonwealth level, with the Chief Executive Officer of Customs authorised to make Tariff Concession Orders (TCOs) that provide for a lower rate of customs duty on goods meeting certain criteria. Specifically, a TCO may be issued if no substitutable goods are produced in Australia in the ordinary course of business, as outlined in sections 269C, 269D, and 269E of the Act. The Act does not apply to goods specified in section 269SJ, which lists goods that cannot be subject to a TCO. The application process requires an application to the CEO, with a requirement to publish a notice in the Gazette inviting submissions from interested parties, as per subsection 269K(1) of the Act. In this case, no submissions were received in response to the published notice. The TCO itself, once made, does not affect the rights of persons other than the Commonwealth, nor does it impose any liabilities, as per subsection 269S(1) of the Act. The TCO is deemed to have come into force on the date the application was lodged, thereby potentially allowing importers to apply for a refund of duty on goods imported since that date.
Key Provisions
The main operative sections of the Customs Act 1901 (the Act) relevant to Tariff Concession Orders (TCOs) include sections 269C, 269B, 269D, 269E, 269F, 269P, 269SJ, and 269K. Section 269F allows a person to apply to the Chief Executive Officer of Customs (the CEO) for a TCO in respect of goods. Section 269C sets out the core criteria that must be met for a TCO to be made, primarily requiring that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Section 269B clarifies the definitions of terms such as 'goods produced in Australia', 'ordinary course of business', and'substitutable goods'. If the CEO is satisfied that the application meets these criteria, section 269P(3) requires the CEO to make a written order (a TCO) declaring that the goods the subject of the TCO application are to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 applies.
The Act imposes several obligations and requirements on parties involved with TCOs. The CEO must determine whether an application for a TCO meets the core criteria as specified in section 269C. This includes verifying that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged. Upon accepting a TCO application, the CEO is required by section 269K(1) to publish a notice in the Gazette inviting any person who considers there are reasons why the TCO should not be made to lodge a submission. The CEO must then consider any submissions received before making a final decision on the application. Furthermore, the Act ensures that the rights of persons (other than the Commonwealth) are not adversely affected by a TCO as per section 269S.
The Act also outlines potential consequences for breaches related to TCOs. While specific offences and penalties are not detailed in the provided text, the Act generally provides for both civil and criminal penalties for breaches of its provisions. The severity of these penalties can depend on the nature and extent of the breach, with maximum penalties potentially including fines and imprisonment. The precise penalties are typically found in other sections of the Act or related regulations, which are not provided in the excerpt. However, it is clear that adherence to the Act's requirements is necessary to avoid these potential consequences.